Tax Alerts
Tax Briefing(s)

There is good news to offer in the form of an enhanced child tax credit.  Under the Tax Cuts and Jobs Act (TCJA), the child tax credit has doubled, increased the refundable portion, and expanded its scope to include dependents other than qualified children.  In addition, the TCJA broadened the pool of taxpayers eligible for the credit by significantly increasing adjusted-gross-income (AGI) phaseout ranges.  The following is an overview of the eligibility requirements and other changes to the child tax credit effective for tax years 2018 through 2025:


As you go about your daily life conducting business online, hackers are in the wings waiting to pounce and exploit one innocent miss-click, mistake or mismanagement of company data. Turning a blind eye or being in denial of the realities of cybercrime and data breaches can destroy your company’s brand and reputation. You must continually work toward protecting your business from cybercrime and you must monitor your systems and process 24/7 without fail.


In general, the new tax Act provides for stricter limits on the deductibility of business meals and entertainment expenses. Under the Act entertainment expenses incurred or paid after December 31, 2017 are nondeductible unless they fall under specific exceptions. One of those exceptions is for “expenses for recreation, social, or similar activities primarily for the benefit of the taxpayer’s employees, other than highly compensated employees.” (i.e. office holiday parties are still deductible). Business meals provided for the convenience of the employer are now only 50% deductible whereas before the Act they were fully deductible. Barring further action by Congress those meals will be nondeductible after 2025.


The 2018 dollar limit on the maximum permissible allocation under a defined contribution plan is $55,000. The maximum amount of annual compensation that may be taken into account on behalf of any participant under a qualified defined contribution plan is $275,000.

The 2018 limit on the maximum amount of elective contributions that a person may make in to a §401(k) plan, a §403(b) tax-sheltered annuity or a §457(b) eligible deferred compensation is $18,500. The limit on "catch-up contributions" for persons age 50 and older is $6,000.

The 2018 dollar limit on the maximum annual benefit under a defined benefit plan is $220,000.


As the school year ends, summer vacation offers parents and students alike the opportunity to focus on what may be their most considered subject: PAYING FOR COLLEGE. Many families commit unforced errors in their efforts to save and pay for hefty tuition bills.

Among the traps people fall into are:

  • Obsessing about school choice;
  • Thinking it isn’t worth it to apply for aid or scholarships; and
  • Not considering “529” college-savings plans.

States have become quicker to declare assets “abandoned” when account owners lose touch with a financial institution.  Although state laws vary, assets may be determined abandoned if the account owner has not made contact with the institution for three to five years.  These accounts consist of refunds, bank accounts, insurance proceeds and recovered goods, including cash, stock, bonds and other items that may belong to you. 


IRS Commissioner John Koskinen has asked companies to report patterns of fraud and for tax preparation firms to team up to fight return fraud.  Criminals are using stolen identities to claim refunds.


The Washingtonian has recognized Dalbert B. Ginsberg as one of the Washington Metropolitan area top Tax Accountants based on a survey of financial professionals and research conducted by the magazine.


The IRS and the Treasury intend to provide regulations that will address issues affecting foreign corporations with previously taxed earnings and profits (PTEP). The regulations are in response to changes made by the Tax Cuts and Jobs Act (TCJA) ( P.L. 115-97)


The IRS has proposed regulations on the limitation on the business interest expense deduction under Code Sec. 163(j), as amended by the Tax Cuts and Jobs Act (TCJA) ( P.L. 115-97). The IRS also has issued a safe harbor that allows taxpayers to treat certain infrastructure trades or businesses as real property trades or businesses solely for purposes of qualifying as an electing real property trade or business under Code Sec. 163(j)(7)(B).


A nonprofit corporation that operated a medical-marijuana dispensary legally under California law was not allowed to claim deductions for business expenses on its federal return. Code Sec. 280E, which prevents any trade or business that consists of trafficking in controlled substances from deducting any business expenses, applied.


The IRS released the optional standard mileage rates for 2019. Most taxpayers may use these rates to compute deductible costs of operating vehicles for:


The IRS has provided guidance and examples for calculating the nondeductible portion of parking expenses. In addition, the IRS has provided guidance to tax-exempt organizations to help such organizations determine how unrelated business taxable income (UBTI) will be increased by the nondeductible amount of such fringe benefit expenses paid or incurred.


The IRS has released initial guidance on the new Code Sec. 83(i), added by the 2017 Tax Cuts and Jobs Act ( P.L. 115-97).

Code Sec. 83 generally provides for the federal income tax treatment of property transferred in connection with the performance of services. Code Sec. 83(i) allows certain employees to elect to defer recognition of income attributable to the receipt or vesting of qualified stock for up to five years.


Highly anticipated foreign tax credit regulations have been issued that provide guidance on the significant changes made to the foreign tax credit rules by the Tax Cuts and Jobs Act ( P.L. 115-97).


Proposed regulations provide much anticipated guidance on the base erosion and anti-abuse tax (BEAT) under Code Sec. 59A and related reporting requirements. The regulations are proposed to apply generally to tax years beginning after December 31, 2017, but taxpayers may rely on these proposed regulations until final regulations are published.


The IRS will grant automatic consent to accounting method changes to comply with new Code Sec. 451(b), as added by the Tax Cuts and Jobs Act ( P.L. 115-97). In addition, some taxpayers may make the accounting method change on their tax returns without filing a Form 3115, Application for Change in Accounting Method. These procedures generally apply to tax years beginning after December 31, 2017. Rev. Proc. 2018-31, I.R.B. 2018-22, 637, is modified.


The IRS has issued transition relief from the "once-in-always-in" condition for excluding part-time employees under Reg. §1.403(b)-5(b)(4)(iii)(B). Under the "once-in-always-in" exclusion condition, once an employee is eligible to make elective deferrals, the employee may not be excluded from making elective deferrals in any later exclusion year on the basis that he or she is a part-time employee.


The IRS has provided interim guidance for the 2019 calendar year on income tax withholding from wages and withholding from retirement and annuity distributions. In general, certain 2018 withholding rules provided in Notice 2018-14, I.R.B. 2018-7, 353, will remain in effect for the 2019 calendar year, with one exception.